Bank Accounts, Trusts, or TOD? Choosing the Right Strategy to Avoid Probate in California
- Linda Varga
- May 27
- 3 min read
Updated: 4 days ago

Probate in California can be time-consuming, expensive, and public. Many people want to ensure that their loved ones can access funds or property quickly after their death—without the delays of probate court.
Fortunately, several estate planning tools are available to help assets bypass probate, including bank account beneficiary designations, revocable living trusts, and Transfer-on-Death (TOD) strategies. But which option is right for you?
This guide compares the pros and cons of bank accounts with beneficiaries (PODs), living trusts, and TOD accounts and deeds to help you choose the most effective probate-avoidance strategy for your estate.
Option 1: Bank Accounts with Payable-on-Death (POD) Designations
What It Is:
A Payable-on-Death (POD) designation allows you to name a beneficiary who will automatically receive the funds in your bank account when you die—without probate.
Benefits:
Easy to set up at the bank
No legal fees or trust documents required
Avoids probate entirely
Beneficiary gets immediate access upon your death
Limitations:
Only applies to that one account
Doesn’t offer control over when or how the money is used
If the beneficiary dies before you and no backup is listed, the account goes through probate
Does not protect against incapacity (e.g., dementia)
Best for: Individuals with simple estates who want to ensure loved ones can quickly access cash after death.
Option 2: Revocable Living Trust
What It Is:
A revocable living trust is a legal document that holds title to your assets during your lifetime. Upon your death, your named successor trustee distributes those assets according to your instructions—without court intervention.
Benefits:
Covers multiple asset types: real estate, bank accounts, investments, personal property
Avoids probate entirely
Includes incapacity planning
Allows for control, staggered distributions, and backup beneficiaries
Maintains privacy (not a public record)
Limitations:
More complex to set up
Must be “funded” (assets retitled in the name of the trust)
May require legal assistance to draft properly
Best for: Individuals or families with real estate, blended families, or those who want detailed control over how their estate is handled.
Option 3: Transfer-on-Death (TOD) Accounts and Deeds
What It Is:
TOD designations allow assets—such as investment accounts or real estate—to transfer directly to named beneficiaries upon death.
TOD accounts are available through most brokerage firms.
TOD deeds (Transfer-on-Death Deeds) allow California homeowners to name a real estate beneficiary without probate.
Benefits:
Simple and low-cost
Avoids probate
Beneficiary takes title immediately after death
Limitations:
TOD deeds must be properly executed and recorded before death
No control over timing of distribution
Can be challenged or invalidated if not correctly prepared
No protection for beneficiaries with special needs or creditor issues
Best for: Individuals who own property or investments but do not want to create a trust.
🔍 Comparison Table
Strategy | Avoids Probate | Covers Multiple Assets | Protects Incapacity | Control Over Distribution | Cost to Set Up |
POD Bank Account | ✅ Yes | ❌ No | ❌ No | ❌ No | Low |
Revocable Living Trust | ✅ Yes | ✅ Yes | ✅ Yes | ✅ Yes | Moderate to High |
TOD Account/Deed | ✅ Yes | ❌ No (per asset) | ❌ No | ❌ No | Low |
Final Thoughts: Choosing the Right Approach
No single strategy fits everyone. Your best choice depends on the size and complexity of your estate, your family dynamics, and how much control you want over what happens after you’re gone.
Here are some general guidelines:
Use PODs and TODs for straightforward transfers and emergency access to funds.
Use a revocable living trust for comprehensive planning, real estate, incapacity protection, and family coordination.
Use a combination of all three to create a layered and effective estate plan.
Before making decisions, consult with an experienced California estate planning attorney to ensure your plan is properly structured and legally valid.
Contact the top-rated California trust and probate attorneys Moravec, Varga & Mooney today to schedule a telephonic consultation. Have questions? call (626) 460-1763 or email LV@MoravecsLaw.com.
Southern California Probate Lawyer Serving all counties in California, including Los Angeles, Riverside, San Bernardino, Sacramento, Santa Cruz & Beyond.
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